The dollar did not get the support from FRS and lost 3% | 19 March 2015

Euro

The European currency strengthened against the dollar after Janet Yellen did not say again anything concrete about the rates changes. The European deflationary pressure decline as well as the Germany and the Eurozone business environment improving sentiment have supported the euro as well. The January euro area foreign trade results report may attract some attention. We believed that the surplus would decrease to 15.0 billion from the previous 24.3 billion, but the figure exceeded our expectations, showing reduction to 7.9 billion.

The level of 1.04980-1.0500 stopped the pair decline and now the pair is growing above it. Yesterday the pair once again recovered, the recovery was limited by the resistance near 1.1000-1.1020. In general, the risks of the lows breakthrough and the decrease continuation are still preserved.

The support levels are 1.0610-1.0630, and the resistance levels are 1.0000-1.0020.

MACD is in a neutral territory.

Trading recommendations

The euro needs to rise up and consolidate above 1.0000-1.0020 for the downward pressure easing.

Pound

The British pound grew against the dollar. Yellen did not support the dollar, the pair sharply grew. The February jobless claims fell by 31.0 thousand in the UK compared to 38.6 thousand in the previous month with the forecast of 30.0 thousand. The level of average earnings (excluding bonuses) fell to 1.6% in January compared with 1.7% in the previous month and the forecast of 1.8%.

The pair pound/dollar came again under pressure from the sellers’ part, lost a little more than hundred points and then fell to the support near 1.4620-1.4640. The pair sharply increased and tested the resistance level of 1.5100-1.5120.

The support levels: 1.4680-1.4700 and the resistance levels: 1.5100-1.5120.

The MACD indicator is in a negative territory.

Trading recommendations

Risks of the level of 1.5100-1.5120 re-testing and breakthrough are still preserved. We should expect increase towards 1.5160-1.5180.

Yen

The pair dollar/yen was traded in the narrow side corridor and finished the day with a decrease. The Japanese economic data showed positive changes - the February deficit decreased to -424.6 billion after -1179.1 billion yen in January. The support levels: 119.05-119.25, and the resistance levels: 121.30-121.50.

The MACD indicator is in a neutral territory.

Trading recommendations

We should consider the pair inability to consolidate above the previous high and its growth continuation as a wake-up call for the bulls, but it is not necessary to talk about the top formation while the pair is trading below the 120-th figure. The pair is very sensitive to the Fed comments.